Keywords Database file is faulty
Each type of file created by Oxford WordSmith Tools has its own default filename extension (e.g. .KDB, .KWS) and its own internal structure. If you have another file with the same extension produced by another program, this will not be compatible. It would not be sensible to rename a .KDB file to .TXT, or vice-versa! WordSmith has detected that the file you're calling up wasn't produced for a database of keywords, by the current version of KeyWords.